Brough's writings on the technology, economic and social issues of communications at the intersection of the Internet, telecom and mobility.

May 30, 2006

There's an interesting patent case, KSR International v. Teleflex, bubbling up through the US courts. It's been reviewed by the Court of Appeals and KSR has petitioned (90 page PDF) the Supreme Court for a writ of certiorari, i.e. for the Supreme Court to consider the case. The question at hand is one of obviousness.

I'm interested because I see a fair number of patents where the invention seems obvious to me. Patents are only supposed to be granted for ideas which are not obvious "to one of ordinary skill in the art" so I could easily become quite conceited. Indeed, when I discuss the obviousness test with potential inventors at NMS, I routinely tell them that they are not "ordinary" so, just because an idea seems obvious to them, doesn't mean it is not patentable. I wish this wasn't the case, but that's the way the system works.

Last October, the Supreme Court invited the
Office of the Solicitor General to file a brief
in the case. That's encouraging as it suggests they may grant certiorari.

For those who are interested, Tech Law Journal has links to the case's history and to various amicus briefs from Cisco, Microsoft and other interested parties. Today, Patently O reports the Solicitor General has filed an Amicus brief (25 page PDF) recommending the Supreme Court grant certiorari. Patently O also provides a bit more background on obviousness tests in the US and the European Patent processes.

Time will tell... At least it now appears likely, this case will be heard by the US Supreme Court.

May 26, 2006

Based on a sample of two, it appears a relatively small percentage (single digits) of registered instant messenger users are actually on-line at any given time. And, if you consider that "on-line" doesn't necessarily mean someone is actually available to receive a communication, the percentages are even lower. That's striking when compared to cellphones, which many people have on for most of their waking hours.

Tencent's annual report (pdf) gives statistics on QQ. Tencent Holdings is a Chinese company whose stock trades on the Hong Kong stock exchange. Their QQ instant messenger service runs on PCs and on mobile devices, mostly within China. As of December 2005, QQ had 493 million registered users, 202 million active accounts and 18.4 million peak simultaneous on-line users. That's about 4% of total registrations, but 9% of active accounts.

What's going to happen as mobile devices become richer communications tools that seamlessly combine context-aware availability with live, or near-real-time messaged, voice, text, photos & video sharing? Think the best combination of VoIP services like Skype and mobile phone interfaces like those I discussed in my March Spring VON presentation.

I expect to see early indications by watching Chinese users as, by shear numbers, the mobile Internet beats the PC-based Internet in China. Companies like Tencent started on the Internet side and have only recently focused on mobile value-added services. It will be interesting to see if QQ's percentage of peak on-line users climbs over the next 12 months.

May 23, 2006

I just got around to playing with Google Trends. For "Brough Turner" it says "not ... enough search volume to show graphs." Ah, vanity, vanity, but hardly surprising.

But look at this comparison.

Trend history

skypevonage

Even without Skype's offer of free SkypeOut service within the US & Canada, one had to wonder, as Andy Kessler does, about the future of Vonage. Vonage looks more like a traditional phone, which helped against Skype & Skype-like services in the near term. But more traditional (also mobile) handsets and speakerphones are coming for Skype. I have to wonder about the future of Vonage or any VoIP service that's focused on replicating traditional telephony at slightly lower cost.

May 19, 2006

Business ideas come in waves and VON conferences are a good way to see what’s hot. An idea that was very visible at VON Europe this past week was Fixed Mobile Convergence (FMC) for the enterprise. There must have been 8–9 exhibitors with this theme, either new startups or existing companies repositioning to hit the wave.

Since I’ve been speaking about FMC for the past year, I was interested. The general pattern is to integrate dual mode handsets with IP-PBX technology, i.e. nobody is waiting for IMS. The compelling business justifications, in order, are to save money, give the IT department more control and provide PBX features to mobile users.

Of course the reason this is happening now is appropriate handsets are becoming available. There are still issues of battery life while using WiFi, but compared to the first generation WiFi-only phones, today’s phones actually have the look and feel of a mobile phone. And they include GSM and/or 3G as well as WiFi.

Just as VON Europe was starting I recorded a podcast with Carl Ford of Pulver Media. It's just under 25 minutes of talk, mostly me, covering what I'm seeing in various telecom and Internet areas where NMS (or I personally) are active. The sequence of topics covered is:

Internet access and what I have in my home

NMS name (NMS Communications vs. earlier name Natural MicroSystems)

What we're seeing in our business unit that sells to VoIP and mobile telecom developers

May 17, 2006

Earlier today I spoke on the "Access Reverticalization" panel at VON Europe Spring 2006. The subject was first mile access and the panel was effectively rigged, i.e. there was remarkable the level of agreement among the speakers. My presentation is here. Between the presentation and the Q&A, my points were:

1. Regulation & legislation: be careful what you ask for. Despite the best of intentions, it's easy to get unexpected results. I used examples I've previously discussed here & here & here.

2. Laws and regulation evolve slowly - over years and decades - so it's worth thinking about where we want things to be in the long term. Indeed, it's a bad idea to argue about evolving today's legacy telecoms regulation if we don't understand what makes sense for the long term, i.e. decades.

3. Competition works, even in telecom. This is clear if we examine relative mobile subscriber growth in the more than 100 countries that now have mobile phone service. Three viable competitors yields growth, while four or more competitors generate really exciting growth.

But how should we choose what to regulate and where to encourage competition?

4. Look at performance evolution rates at each "layer" of the local connection.

Routers and Switches, i.e. TCP/IP or Ethernet: Faster than Moore's law

Lighting the fiber: Faster than Moore's law

Fiber itself: Slowly improving - 20 year useful life

Conduits and poles: Slow evolution - 20+ years useful life

Local rights of way: Fixed, limited and communally owned.

This table suggests an answer!

5. We have a real bottleneck in the limited local right-of-way, so regulation is required. But it makes sense to match time scales. That means we should regulate at the stable layer and foster competition at every layer above, certainly at every layer above dark fiber.

How might this work?

1. Competitive access to poles and conduits, a.k.a. layer zero competition. The government controls the poles and conduits and makes them available to any interested party including developers, service providers and community or private organizations. With overlashing on shared support cables, many more cables can fit overhead than is typical today and additional conduit banks can be deployed on popular underground routes.

2. Condominium fiber. Developers, or contractors working with groups of interested parties, lay fibers and sell individual fibers on a condominium basis. There's a good overview of the subject here.

3. Municipal dark fiber. The government organizes the fiber deployment and makes dark fiber available to all comers. Stokab AB in Stockholm is a very successful example of this model.

None of the above requires that individual homeowners worry about these issues. The point is to make it easy for many, many providers to compete to offer services to individuals and businesses.

Is it possible?

There are many vested interests that stand in the way of realizing anything like this, but if we don't articulate the desired end goal, we will never get there.

May 16, 2006

I'm listening to the Peer-to-Peer SIP session at VON Europe and find myself more interested by the general concepts being discussed than by the specifics of SIP for peer-to-peer networks. The interesting discussion is around identity, community, security and legal intercept.

Identity comes down to public key encrypted unique identifiers that you then choose to make available to various communities, perhaps including the entire Internet. But whenever you make any identifier public, you invite people to contact you. If you make an identifier widely available, you may need a screening function. This can be on your client or you can delegate the function to someone else. But this is true whether the communication means is peer-to-peer or centrally controlled. I publish my Skype user name "brough" quite widely. I only publish Skype presence to people I know and I chose what kinds of interactions I want to have with those I don't recognize. If I did choose a 3rd party to screen contacts for me, it could be a peer proxy or a 3rd party server, but that is independent of whether the systems is peer-to-peer or not.

The security discussion exposed the fact that, whether you have peer-to-peer or not, no firewall can protect against a rogue client within the trusted environment. This of course is why Skype works anywhere. It just nice to hear a public discussion of this simple fact. Not everyone gets it.

Legal intercept in the Internet can be done via a cooperative client (e.g. in an enterprise call center that does logging) or at an aggregation router. At the router, one can only expect to get address pairs, flow statistics and copies of the packets. If the packets are encrypted, you won't get the contents (easily). That's it. With encryption at the end points, you'll have to defeat the encryption to read the content of the flows. That's independent of whether you are using peer-to-peer or a centrally controlled service. It's a function of encryption at the end points.

The Supreme Court decision today in favor of Ebay in the MercExchange case is an important one. The justices decided that judges do have leeway to withhold injunctive relief in patent cases -- the U.S. Court of Appeals for the Federal Circuit had held that injunctions were mandatory -- and it struck down the prior CAFC decision.

With SBC's acquisition of AT&T and Verizon's acquisition of MCI we saw a major consolidation in North American fiber networks. Luckily there are still numerous Internet backbones and plenty of fiber between cities in the US. On the other hand, competitive local access to buildings is a concern in the ILEC territories of SBC (now ATT) and Verizon. In buildings with competitive fiber access arrangements, will that competition survive?

With the 1983 Bell System divestiture, and the many subsequent M&A, regulatory and legislative actions, we were promised competition between the ILECs. It never happened. Perhaps there was no direct collusion, but by whatever means, each ILEC was careful to keep out of the others territory. Five years from now, will we still have competitive access arrangements in major office buildings or will your local ILEC be the only source of local access?

Yesterday, the 3rd remaining ILEC, Qwest, announced it was purchasing OnFiber Communications. OnFiber has metro Ethernet networks in 23 US cities. This is more consolidation, but I'm actually optimistic (or a fool). Of all the ILECs, Quest is the slightly feisty one. If any ILEC can compete in other ILECs' territories, it will be Qwest. Time will tell.

In brief opening remarks I suggested many in the VoIP industry are still focused on digital POTS - using VoIP to reproduce traditional fixed-line telephone service - yes, with a few extra bells and whistles, but POTS none-the-less. I suggested we could do better. From the consumer point of view, the most significant change in telephony in the past 15 years has been the shift from telephones at fixed locations to personal telephones, i.e. your mobile.

To have a real impact on consumers, we (the VON industry) will have to bring extended IP communications capabilities to mobile devices. Think Skype on your mobile handset, but with your choice of text, voice, photos or see-what-I-see video delivered live (conversation) or near realtime (SMS, IM, VoiceSMS, photos, etc.), and optionally captured for possible later posting to your blog or home page on MySpace, Cyworld or the like.

May 08, 2006

A few weeks ago I made a short mention of problems with the calling party pays (CPP) model for mobile phone service as part of a post on telecom regulation. That post generated some heated comment, so I elaborated a few days later. The more complete explanation only generated more comment. But it also resulted in an excellent referral from Usman Latif a.k.a. Techuser who pointed out a brand new paper by Professor Stephen Littlechild, "Mobile Termination
Charges: Calling Party Pays versus Receiving Party Pays" in
Telecommunications Policy, Vol 30/5-6 pp 242-277. A copy is online
here:http://www.econ.cam.ac.uk/dae/repec/cam/pdf/cwpe0426.pdf. The on-line text says it's preliminary and not to be cited, however I inquired of Professor Littlechild who said, with the paper accepted for publication, that prohibition no longer holds.

Professor Littlechild provides a comprehensive study of the issue, with up-to-date footnotes citing an
array of other economics and regulatory literature. Some extracts:

In many countries there is widespread concern at the level of mobile termination charges. This is attributable to the bottleneck monopoly created by the Calling Party Pays (CPP) principle. It has led to increasingly severe price controls on termination charges. Regulatory experience in the three foremost such countries (UK, Australia and New Zealand) suggests that price controls are of limited effectiveness in aligning termination charges with costs, that net welfare gains from controls are small and that costs of setting controls are high.

The Receiving Party Pays (RPP) principle, which applies in North America and
several Asian countries, avoids the bottleneck monopoly problem. ... average revenue (price) per call is significantly lower with RPP, average minutes of usage per subscriber are significantly higher, and mobile penetration rate is not significantly different.

Usman's email included his experience in Pakistan:

Yesterday, I got a WLL connection from PTCL and noticed that WLL connections were selling like hotcakes. The reason according to the salesperson was the reduction in the price of CDMA handsets. According to the salesperson, PTCL had dropped the price of CDMA handsets from close to Rs. 4000 to Rs. 2000 two days back and since then there had been a huge spike in sales.

From this experience, and my prior observation as to poorer folk using used handsets, I have to say that the initial cost/effort of acquiring a telephone connection is the most important factor determining teledensity in a developing country. People always figure out ways to keep their phone bills low by economizing on the use of phones, but if the initial cost of acquiring a connection is high, they prefer to stay away. Consequently, I believe CPP had absolutely nothing to do with the astronomical increase in the number of subscribers in Pakistan, and the drop in government taxes on new mobile connections had everything to do with it.

Pakistan's current rate of increase in teledensity appears to be the fastest in the world. But the timing (early 2005) doesn't match CPP. As I commented back in December,

…real changes happened in 2004. First, in April the government
granted two more licenses < thus six competitors>. Telenor won
one of those licenses, built a network and launched services in
February 2005. Warid won the other, launching services in April 2005.
Second, in June 2004 the government abolished the remaining
restrictions on foreign direct investment permitting foreign investors
to retain 100% equity in their investments. And third, they dropped
the activation tax to Rs. 500 (~ $ 8) <from Rs. 5000 in 2001>.

May 07, 2006

It appears Philips Corporation has gone public about how they misuse the patent system. Too bad others are not so forthcoming.

Darknet points out an amazing story by Randell Stross in this weekend's NY Times. Darknet is amazed by the stupidity of the idea that a corporation like Philips would apply for a patent on a system to prevent users from changing the channels on their TVs during commercials. I agree this is one of the most unlikely-to-succeed ideas I've heard of, but what struck me was this discussion with a Philips spokesperson:

When I spoke last week with Ruud Peters, the executive in charge of
intellectual property at Philips, to learn how it would be pitched to
consumers, he explained that the patent application had no connection
to any Philips products in the pipeline. And, he explained, the notion
of temporarily crippling the remote control to protect advertising is
already out there and did not originate with his company.

Patents are only available for ideas that are not obvious and patents are only granted to the person who originally thought up the idea. Why is Philips applying for a patent on an idea that is "already out there and did not originate with <Philips>"?

May 04, 2006

I'll be at Spring VON Europe in Stockholm this year, arriving mid-day Monday May 15th and attending through Thursday evening. I'm speaking on the panel "What Industry Are We In?" in the general session at 5pm on Monday and in the breakout session "Access Reverticalization" on Wednesday May 17th at 9am. In addition, we have a booth (Stand 660), where we'll be demonstrating our Vision communications servers powering a variety of video and multimedia solutions. I have specific sessions I plan to attend and meetings scheduled, but I am not fully booked. If you will be in Stockholm and want to meet, send me an email (rbt at nmss.com) or IM me on Skype ("brough") or call my mobile +1 617 285 0433.

I've also recorded a Podcast with Laura Nembach of Pulver Media (boilerplate and link here; MP3 file here) in preparation for VON Europe. The topics we covered were:

Fixed-mobile convergence

Innovation in IP communications

Video telephony and "see what I see" applications

Voice over WiFi and WiFi meshes

Access reverticalization vs. first mile connectivity

The second, fourth and fifth topics directly overlap with what I'll be talking about my two public presentations. The first and third are hot topics for NMS, representing markets where we're seeing adoption of our Vision line of communications servers.

If you're not going to be in Stockholm and/or you have 15 minutes to burn, try the podcast.

May 03, 2006

As CTO at NMS, I run our patent program and I provide technical support for our legal department and our business units when patent issues arise. Since I've been doing this from our start, I've seen more than enough to know that the patent system is broken, globally. Certainly the bulk of what I've seen has little to do with the original purpose of patents namely "to promote the progress of science and the useful arts" or "encourage innovation, which assures that the quality of human life is continuously enhanced."

While I don't have a set of recommendations, I did recently stumbled on this paper by Professor Beth Noveck of the New York Law School which I found very interesting. It proposes a way to leverage communities and the Internet, to address at least one part of the problem - patents that never should have been granted in the first place. If you are interested in patents, at least read the abstract.